McCarthy Biden’s US Debt Ceiling Raise
Last night in America, during an agitated session in the House, the bill was passed to remedy the US default that would have put an end to the fiat dollar, an eventuality that will have to be confirmed by approving it in the Senate by next June 5th. Senate Majority Leader Schumer and Minority Leader McConnell promised to pass the bill as quickly as possible, i.e. in 48 hours.
The McCarthy-Biden bill, presented and approved tonight in the House, disavows a previous version of the agreement circulated in recent days, because it effectively increases the debt ceiling (now at 31.4 trillion dollars) and does not postpone the deadline, finances the Green New Deal at the expense of the traditional energy sector, finances new odious agents of the IRS (the American Equitalia) instead of abolishing them, as the Republican Party had requested, but above all it heavily finances the corrupt Chris Wray at the head of the FBI , currently on trial in the House for the serious abuses committed against the Trump Presidency.
The bill was called the Fiscal Responsibility Act and was passed with the support of the two significantly split parties, a dramatic conclusion after weeks of tense and very opaque negotiations between the White House and House Speaker Kevin McCarthy. The political fact is that 149 Republicans voted "Yes" while 71 voted "No", while among the Democrats the ratio was 165 "Yes" and 46 "No", with 4 abstentions. Many Republican deputies have expressed no confidence in McCarthy by announcing his replacement, a concrete possibility in light of 71 votes against already cast (the majority speaker in the House must have the support of the majority of House members and cannot be voted by the minority).
The political match now moves to the Senate, which is however controlled, even if by a hair's breadth, by the Democrats. Here the leaders of both parties want to approve it in 48 hours and barring sensational surprises the Fiscal Responsibility Act should pass in extremis.
However, what happened to the House tonight does not solve the structural problems but simply puts a patch on the very battered hull of a sinking ship, thus preventing it from sinking on June 5th. Even if this measure were passed within 4 days, the US default would be legally averted by 5 June, but not the technical danger of default. The escalation of geopolitical tensions in which many nations refuse payments in dollars, and the stress of the inflationary spiral to which the entire Western financial system is subjected, starting with the big banks, could trigger a disruptive event capable of splitting the hull, thus causing the ship to sink at any moment, and in the context of an evidently cathartic panic explosion.
For many commentators, the outcome of this affair was obvious, because it was normal to think that no party or politician wanted to claim the default. However, Archimedes' principle is the Truth, and a ship that is not afloat cannot be prevented from ending up at the bottom of the sea by voting against Archimedes by a majority.
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McCarthy Biden's article Raising the US Debt Ceiling comes from Economic Scenarios .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/elevazione-del-tetto-del-debito-usa-di-mccarthy-biden/ on Thu, 01 Jun 2023 10:00:14 +0000.